Military realignment could mean big business for contractors

Once finalized, the recommendations of the Base Realignment and Closing Commission could be a boon for the construction industry in communities that are adding military personnel and facilities.

Virginia’s Ft. Belvoir, which would experience one of the largest personnel gain if current recommendations stand, is just one example. The realignment plan calls for up to 18,430 additional jobs there, significantly increasing the installation’s existing staff of 23,000.

“The immediate impact for contractors will be on bases that are going to add new functions or manpower such as Ft. Belvoir, which is adding a major healthcare center,” said Ken Simonson, chief economist with the Associated General Contractors of America. “Presumably you would need to put up appropriate structures there, as well as build base housing. Later you will see retail facilities, consumer services and off-base housing.”

Immediate is a relative term, however. The commission will send its final recommendations by Sept. 8 to the president, who must approve or reject them by Sept. 23. Once the president approves, Congress has 45 legislative days to reject the list in its entirety before it becomes binding. Closures and realignments will occur during the following two to six years, according to the Department of Defense’s Office of Economic Adjustment.

And while Congress’ go-ahead turns the commission’s recommendations into marching orders for the military, the legislative body still must fund the closures, expansions and realignments by going through normal appropriation procedures.

“Ultimately this is good news for many contractors, but given the demands on the military now it might mean a squeeze on the dollars in the short term,” Simonson said.